![\"House](\"https:\/\/nash4homes.com\/wp-content\/uploads\/2013\/06\/homevalues.jpg\")
Once you find a great Seattle or Eastside home, the first step to getting a good deal (or at least not paying over fair market value) is to determine as closely as possible what the fair market value actually is.<\/p>\nOnce you find a great Seattle or Eastside home, the first step to getting a good deal (or at least not paying over fair market value) is to determine as closely as possible what the fair market value actually is.<\/p>\n
Fair market value is the price at which a home will sell under reasonable conditions in the current market.<\/strong> This means that the sale is not affected by extenuating factors compared to competing homes, such as restrictions on showing that make it very hard for people to schedule appointments to see it, or a history of pricing that started out far too high and wasted a lot of market time \u2013 or, conversely, a buyer to whom the home is worth significantly more for some reason specific to just that one individual (i.e., a close friend lives on the same street).<\/p>\n When we evaluate a home\u2019s pricing through a Comparative Market Analysis (CMA), we compare it to similar properties<\/strong> that have either recently sold, are pending sale, or are available for sale (\u201cactive\u201d), and we look at both tangible and intangible home value criteria<\/strong>.<\/p>\n Similar properties that have sold recently are the best gauge of a home\u2019s value because we know how much those homes actually sold for, and how long they were on market for first<\/strong>. Until a sale closes the price that the sellers accepted is undisclosed unless the listing agent decides to part with that information, which in general they do not.<\/p>\n When a home is pending we don\u2019t know what price the seller accepted in the offer, but we can at least see how long it was on market prior to going pending, and at what price it received an acceptable offer<\/strong>. (This doesn\u2019t mean that the accepted offer was close to list price; however, the shorter the market time, the more likely this is.)<\/p>\n Available homes that have been on the market for a while (e.g., over 30 days in a reasonably active market) without going off market can be used as data points<\/strong> for prices that are probably too high for those particular properties. This is especially true when you pass the 45 and 60-day points. Homes that have only been on market 10 or 15 days tell us less because we don\u2019t know if they\u2019ll go pending in one day or 120 days.<\/p>\n A good comparable property is a home that is similar in size and features to the one you\u2019re considering, and ideally in that same neighborhood and\/or subdivision.<\/strong> A second category includes similar homes that may not be in that same neighborhood, but that are reasonably close and would also be desirable to buyers who are looking for the same kind of home you\u2019re considering.<\/p>\n If you\u2019re looking at condos, it\u2019s best to compare it to units in that same complex. Pricing tends to be somewhat complex-specific, so you usually get less information looking at units in other complexes, although those are still helpful.<\/p>\n Ideally, the \u201cSold\u201d properties we use as comparables will have closed within the last three months, but we also take into account seasonal fluctuations that affect prices.<\/strong> For example, if we\u2019re pricing a home in February, keep in mind that the \u201cSold\u201d data reflect homes that got offers during the slower winter months and we\u2019re now entering the busy buyer months \u2013 expect to have to err on the higher side. In June it\u2019s the opposite; we\u2019re looking at \u201cSold\u201d data for homes that went pending during the busiest time of the year just as we\u2019re approaching a summer market that is typically slower.<\/p>\n When I work with buyers, I pull together all the information for the market analysis and we go over it together<\/strong>. It should make sense to everyone, and usually we end up on the same page as far as a final price evaluation. Once you know what a home is really worth you can safely make an offer knowing what your line in the sand is, and can even compete against other buyers in a multiple offer if you choose to because you know how high you can go without paying over market value. That\u2019s why coming up with a realistic estimate of fair market value is crucial to moving forward successfully with a Seattle area home purchase.<\/strong><\/p>\n Click here to go to the \u201cSeattle and Eastside Home Buying Tips<\/a>\u201d page.<\/strong><\/em><\/p>\n Direct: 206-335-3335How Do We Determine How Much a Home Is Really Worth?<\/h3>\n
What do \u201cSold\u201d homes tell us?<\/h3>\n
What do \u201cPending\u201d homes tell us?<\/h3>\n
What do \u201cActive\u201d Homes tell us?<\/h3>\n
What\u2019s a Good Comparable Home?<\/h3>\n
What Other Factors Do We Look At?<\/h3>\n
Who Does the Market Analysis?<\/h3>\n
\n\n\n![\"Mike](\"https:\/\/nash4homes.com\/wp-content\/uploads\/2013\/07\/irene150.jpg\")
Irene Nash, Seattle and Eastside Real Estate<\/strong>
\nBroker, Allison James Estates & Homes<\/p>\n
\nEmail: irene@nash4homes.com<\/p>\n